Pmi Rebounds In December Remains In Contraction

Chicago Business Activity Moves into Expansion

PMI Rebounds in December, Remains in Contraction

Chicago, December 18, 2023 - The Chicago Business Barometer, aka the Chicago PMI, jumped to 55.8 in November from 44.4 in the prior month. This is the first time the index has moved into expansionary territory since February of 2022.

The Chicago PMI is a measure of manufacturing activity in the Chicago region. A reading above 50 indicates expansion, while a reading below 50 indicates contraction. The index is calculated by surveying purchasing managers on their expectations for business conditions in the coming months.

The improvement in the Chicago PMI is likely due to several factors, including increased demand from consumers and businesses. The holiday season typically boosts retail sales, and this year is no exception. Additionally, businesses are beginning to invest more in new equipment and inventory in anticipation of future growth.

Despite the improvement in the Chicago PMI, the index remains in contractionary territory. This suggests that the manufacturing sector in the Chicago region is still facing some challenges, such as supply chain disruptions and rising costs. However, the recent improvement in the PMI is a positive sign that the manufacturing sector is starting to recover.